Have you ever looked at the price of a luxury car in India and wondered why it feels so high? It turns out that you don’t imagine things.
A land cruiser of 2 crosses in India costs only 30 Lakh in Dubai. It is a price difference of 80% – for the same car.
“The price difference is astounding,” said investment banker Sarthak Ahuja. “A BMW X5 which costs 1 crore of 1 ₹ in India is available for around $ 65,000 (55 ₹ Lakh) in the United States – almost half of the price.”
He points out that a Range Rover Sport, at the price of 2 ₹ in India, would only cost 80 Lakh in the United States, about 60% cheaper.
But Dubai is the place where mathematics really go back. “A fortune that costs 50 Lakh in India is sold at 35 Lakh in Dubai, and the Land Cruiser is almost 80% cheaper,” added Ahuja. Even the BMW X5 is around 75 Lakh in Dubai – another 25% cheaper than India.
So what’s going on here? According to Ahuja, everything comes down to the punishing tax regime of India. “Import duties on luxury cars are between 60%and 100%, TPS adds 28%, then there is a stop and finally taxes on the roads of the state,” he explains. “Indeed, 45% of the car price of the car in India is just taxed.”
On the other hand, Dubai has a minimum of import rights, and the final price depends more factors such as local demand, shipping routes and loose control. “This is why price differences vary on the model model, even if the taxes are weak,” notes Ahuja.
However, he adds that all hope is not lost for Indian buyers. “If you look at a Maruti, Tata or Hyundai, you better buy in India – they are made here and the prices are competitive worldwide.”
